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Sunday, September 25, 2011

Action sought on power rate

Monday, September 26, 2011

CEBU CITY -- Defer everything in the pipeline that could result in another power rate increase, five organizations appealed to the Aquino administration.

The groups, which included exporters, business owners and a party-list organization, asked why addressing the "very high" power rates does not seem to be a priority for the administration, which left it out of its Legislative-Executive Development Advisory Council (Ledac) concerns.

"There appears to be no specific and strong action program or road map coming from the executive department" to address rising power rates and supply problems in Mindanao, said their joint statement.

The five are the Philippine Chamber of Commerce and Industry, the Philippine Exporters Confederation, Philippine Steelmakers Association, Foundation for Economic Freedom and Trade Union Congress of the Philippines (TUCP) party-list.

"If power rates are left alone to escalate, then we shall surely create what the United Nations describes as 'energy poverty', which is the result of taking away food from the tables of the poor and labor, on account of power costs," they said in their joint statement.

"This could trigger an eventual call for a wage increase."

The Associated Labor Unions (ALU) estimated that some 11 percent of the total monthly income of Filipino workers is used to pay for power bills.

"The increasing electric costs are eating away the family budget allotted for food, medicines, decent shelter and education for their children," said an ALU-TUCP statement sent to Sun.Star Cebu.

It asked President Benigno Aquino III to "make politically difficult decisions", starting with asking the Energy Regulatory Commission to suspend all pending petitions for a power rate increase.

Losses

The five groups' joint statement recommended, among others, asking the national grid and power distributors to reduce systems losses by three percent or more.

It also recommended speeding up the transfer of two power barges in the Visayas to Mindanao "to affect power supply relief in the region in about 24 months, instead of the current non-solution status."

It asked the government defer any "high-cost" renewable energy program—such as solar, wind and ocean—and to focus instead on cheaper ones like biomass and "run-of-river hydro."

Department of Energy Visayas Director Antonio Labios could not be contacted for comment Sunday.

The groups asked for "direct and urgent national leadership intervention" so that worries about rising power rates or inadequate reserves can be addressed.

They added the Electric Power Industry Reform Act (Epira) has not produced good results since it became a law 10 years ago.

Higher rates

The groups behind the statement represent business, workers and representatives from the academic and finance communities.

"It is not often that these sectors meet, argue, discuss and come to a common platform that needs urgent attention from national leadership and calling for a clear and well-thought-of action program that everyone can count on and must aggressively support," the statement said.

The groups said that as early as 2009, quoting data from the International Energy Council, the Philippines' industrial electricity rate was the highest not only in the Asia Pacific region, but also in the Netherlands, United States, France and Sweden.

The residential electricity rate is likewise higher than that in most countries, except Germany, Italy, Sweden and the Netherlands, they said.

Last September 23, House Deputy Speaker Lorenzo "Erin" Tañada warned of higher rates for electricity, given "questionable" sales of power plants by the Power Sector Assets and Liabilities Management (Psalm) Corp.

Tañada said he received reports about alleged anomalies in the disposal of power assets by Psalm, a government-owned company created under the Epira to handle the privatization of government power plants. (EOB of Sun.Star Cebu)

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FEF is a public advocacy organization dedicated to advancing the cause of economic and political liberty, good governance, secure and well-defined property rights, and market oriented reforms. It counts among its members former and present Cabinet secretaries and undersecretaries, leading figures in the academe, respected media personalities and opinion makers, and prominent members in the business and finance community.